Although portals can improve services to citizens by bringing business
transactions online, they also can streamline back-office processes. For
instance, as people pay property taxes, utility bills or vehicle registration
bills online, their government automatically receives records of the transactions.

Tom Lesnak, city administrator of Albany, Mo., said he improved back-office
processes and has a better grasp of service requests by using govt.com's
OurTown software. "It's a good in-house tool and a way to help residents
make requests," he said.

"Residents can issue the requests from their home computer at night, and
the next morning, the work order is automatically printed out and placed
in the bin for service," Lesnak said. If a resident sees a streetlight go
out at 10 p.m., he can enter a service request online immediately to replace
the light, and it will be received by 8 the next morning, he said.

Govt.com offers to tie front- and back-end systems together and provides
customized implementations or application hosting as well as in-house training.
OurTown is based on Microsoft Corp.'s Visual FoxPro desktop database and
an HTML-based front end.
Before installing OurTown, Albany could barely keep up with the paperwork.
"Projects would pile up and fall through the cracks," Lesnak said.

Now, the software creates the equivalent of a paper trail as each request
is made online, so the work doesn't pile up.
"We are interested in helping governments streamline their business processes,"
said John Chomeau, govt.com vice president of marketing.

To pay govt.com to set up its Web portal, Albany received $11,500 from
the state through a program called Community Information Networks, designed
to provide rural access to the Internet in Missouri. Govt.com sent the county
seat the software to install in advance, then traveled to Missouri to spend
three days training staff members to use it.

The Atlanta-based ezgov.com has cornered another local government market
with a Java-based front-end solution that offers fast implementation and
an application service provider (ASP) model, in which the company, rather
than the agency, manages the application.

Riverside County, Calif., is using ezgov.com to find some relief from
service request bottlenecks. The county wanted a system that would enable
taxpayers to research and pay property taxes online.

"We were overwhelmed by service demands. The phone lines were always
jammed," said Tom Mullen, the county's chief deputy treasurer and tax collector.

Once the county provided ezgov.com with a copy of the tax database,
it took several weeks of work to integrate the back-end systems to make
sure the county and ezgov.com were in sync, Mullen said.

This is how Riverside's system works: When residents enter in their
addresses, they see their assessment parcel number, a legal description
of their property, and property values broken down by structure, land value
and taxes due.

At the bottom of the screen, people find the option to pay their taxes
online. Once a resident enters his or her checking account and bank routing
information, ezgov.com sends the numbers to the bank through a check clearinghouse,
which then transmits the file to the bank and the county to credit the taxpayer's
account for the transaction.

"A confirmation number acts as a receipt, which allows them to see that
their payment was accepted by our system," said Howard O'Dell, ezgov.com
project manager.

The National Information Consortium (NIC) forms partnerships with state
governments in self-funded, public/private businesses that then manage
the Web portals. States avoid having to chase down appropriations by letting
NIC foot the start-up capital; NIC gets a share of the revenue generated
by charging fees to Web users (such as $1 per transaction) for the convenience
of doing business online.

NIC uses a variety of technologies to Web-enable a state's existing
systems, which includes tying into its databases.

"NIC is technology-agnostic, so we can deliver what the states want,
but we have core competencies in Oracle [Corp.] and Sun [Microsystems Inc.],
and the majority of our development work is in Java," explained Joe Nemelka,
NIC executive vice president of market development.

Virginia is one of 11 states that formed a public/private business partnership
with NIC to manage its Web portal. In each of the states, NIC has created
local subsidiary companies, such as Virginia Interactive (VI). The subsidiaries
then contract with a state-owned entity, which earns revenue only if the
portal is used.

In Virginia, it's the Virginia Information Providers Network (VIPNet)
that hired VI to staff and operate its Web portal. VIPNet has generated
$3 million in gross revenue, said Rodney Willett, director of marketing,
general counsel and Web portal manager for VIPNet and VI.

"If a driving record is sold for $5, for example, to an insurance company,
$1 goes to the network and $4 goes to the motor vehicle department," Willett
said. "With the VI model, we have the opportunity to grow the network to
see revenue from it, but we are also absolutely committed to providing free
services."

One example of a free service is Virginia's Commonwealth Calendar, an interactive
public meeting calendar. However, for a subscription fee of $400 per year,
VIPNet also offers a searchable legislative database called Legislative
Tracking Services for researching bills. It provides summaries of all bills
on taxes, privacy or Internet issues.

A fourth major player in this market, the New York-based govWorks.com, targets
local, state and federal governments as a centralized ASP, rather than approaching
state or local government Web portals individually.

"We have a pilot program working with more than 25 city and county governments
[that] are currently field-testing the electronic interface between our
online payment system and their back ends," said Linda Morse, group executive
of govWorks.com's Public Sector Group.

This winter, govWorks.com plans to launch nationally. The initial network
will consist of govPay, an online payment application for citizens, business
and government, and govPages, an informational application. The complete
govWorks network will be phased in and fully available by the end of this
year.

These are only a small sample of the growing number of online services
offered today by state and local governments on their Web portals. Market
demand and competition will only heat up further as providers expand.

"There are 3,155 counties in the country. We have a lot of opportunity
to grow," said Ed Trimble, president and chief executive officer at ezgov.com.
"The biggest challenge we'll face is keeping up with the wave of requests
for Web-based state and local government services."

A two-year campaign that prompted the Department of Homeland Security to issue its first-ever emergency directive to agencies to shore up cyber defenses appears in part to have been an attempt to spy on U.S. government internet traffic.